Subsidies to Belarusian economy to be based on public-private partnership

2011-10-12 11:30:04

The subsidies to the Belarusian economy will be granted on the terms of public-private partnership, Economy Minister of Belarus Nikolai Snopkov said at a session of the Council of Ministers to discuss import substitution on 11 October, BelTA has learnt.

A legal act on subsidies has already been drafted. “Under the legal act, various types of subsidies will be provided solely for the investment projects implemented on terms of public-private partnership,” Nikolai Snopkov said. The following factors will be taken into consideration while granting subsidies: competition, priority and efficiency. “I am talking about the real efficiency, not the declared one,” the minister underlined.

Import substitution projects will be financed in the same way. The increase in the manufacture of import substitution products results in a lower material and energy intensity of goods.

He emphasized that export-oriented and import-substituting production is becoming more relevant against the backdrop of the formation of the single economic space. The minister noted that all the borders will be removed in the single economic space. “Not only we trade without borders, we also get products without borders,” Nikolai Snopkov said. “This is why, if we do not export, we will consume what our partners have produced,” he added.

According to the estimates of the Economy Ministry, in order to cement the positive trends in foreign trade and reach a foreign trade surplus, Belarus needs to ensure a balance between the export and domestic consumption. The ratio should be 65% (export) and 35% (domestic market). This figure was posted in July 2011 when Belarus reported a surplus in industry.

However, only the Industry Ministry, Belneftekhim Concern and Bellesbumprom Concern are close to this target. Therefore, a task was set for other government agencies to follow suit. The domestic market should shrink, and the majority of products should be sold abroad.

To this end, Belarus needs to support exporters, carry out an aggressive trading policy, and create a favorable business climate and the necessary incentives. Nikolai Snopkov emphasized the need to offer more stimuli to top managers of the companies that account for 75% of the export revenues.